NIKE (NYSE:NKE) Shares Gap Down on Analyst Downgrade

Key Points

• NIKE shares gapped down from a $35.15 close to a $32.55 open after BTIG cut its price target from $55 to $50, although it maintained a buy rating.
• NIKE beat quarterly EPS expectations with $0.48 versus $0.43, but revenue fell 4.3% year over year to $11.21 billion, missing estimates amid weakness in Greater China, Sportswear and Jordan.
• The outlook remains challenging: NIKE forecast fiscal 2027 EPS of $1.15–$1.35 versus analyst expectations near $1.66, while its average analyst rating is “Hold” with a $43.77 consensus price target.

NIKE, Inc. (NYSE:NKE - Get Free Report)'s share price gapped down prior to trading on Friday after BTIG Research lowered their price target on the stock from $55.00 to $50.00. The stock had previously closed at $35.15, but opened at $32.55. BTIG Research currently has a buy rating on the stock. NIKE shares last traded at $33.2860, with a volume of 41,668,361 shares traded.

A number of other analysts also recently commented on the stock. DZ Bank reiterated a "buy" rating on shares of NIKE in a report on Tuesday, June 30th. Robert W. Baird dropped their price target on NIKE from $44.00 to $36.00 and set a "neutral" rating for the company in a research report on Friday. Zacks Research raised NIKE from a "strong sell" rating to a "hold" rating in a report on Wednesday, August 19th. Truist Financial set a $42.00 price objective on NIKE and gave the stock a "hold" rating in a research report on Wednesday, August 26th. Finally, Bank of America reissued an "underperform" rating and set a $24.00 price objective (down from $30.00) on shares of NIKE in a research note on Friday. One research analyst has rated the stock with a Strong Buy rating, nine have assigned a Buy rating, twenty have assigned a Hold rating and eight have given a Sell rating to the stock. According to data from MarketBeat.com, the company presently has an average rating of "Hold" and a consensus price target of $43.77.

Insider Activity at NIKE

In other NIKE news, insider Amy Montagne sold 4,867 shares of the stock in a transaction dated Friday, August 7th. The shares were sold at an average price of $42.05, for a total transaction of $204,657.35. Following the completion of the transaction, the insider owned 57,436 shares of the company's stock, valued at $2,415,183.80. This trade represents a 7.81% decrease in their ownership of the stock. The sale was disclosed in a filing with the SEC, which is available through the SEC website. Also, COO Venkatesh Alagirisamy sold 3,671 shares of the business's stock in a transaction that occurred on Wednesday, September 9th. The shares were sold at an average price of $37.59, for a total transaction of $137,992.89. Following the completion of the sale, the chief operating officer directly owned 104,862 shares in the company, valued at $3,941,762.58. This trade represents a 3.38% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders have sold a total of 14,974 shares of company stock valued at $600,126 in the last quarter. Corporate insiders own 1.10% of the company's stock.

Key Stories Impacting NIKE

Here are the key news stories impacting NIKE this week:

• Positive Sentiment: NIKE reported adjusted earnings of $0.48 per share, exceeding the $0.43 analyst consensus. The company also said its “Sport Offense” is making progress, and its new Caitlin Clark signature shoe nearly sold out shortly after launch. NIKE Fiscal 2027 First-Quarter Results
• Positive Sentiment: Management launched the Pace restructuring plan, which is intended to simplify operations, improve efficiency and accelerate the eventual recovery. BTIG retained a “buy” rating, although it reduced its price target from $55 to $50. Nike Announces Pace Restructuring Plan
• Neutral Sentiment: Analysts are becoming more cautious: Baird cut its target to $36 and assigned a “neutral” rating, while Stifel lowered its target to $36 and maintained “hold.” Needham also reaffirmed “hold,” reflecting limited confidence in a near-term recovery. Needham Maintains Hold Rating
• Negative Sentiment: Revenue fell 4.3% year over year to $11.21 billion, missing the $11.32 billion consensus. Weakness in Greater China, Sportswear and the Jordan brand, along with intense competition from local Chinese brands, overshadowed resilience in North America.
• Negative Sentiment: NIKE forecast fiscal 2027 adjusted EPS of only $1.15 to $1.35, well below the roughly $1.66 analyst expectation, and warned that revenue could decline by a high-single-digit percentage. Management also plans additional job cuts after two rounds of reductions earlier this year, reinforcing concerns about the depth of the slowdown. Nike Weak Outlook and Layoff Plans

Institutional Trading of NIKE

A number of institutional investors and hedge funds have recently added to or reduced their stakes in the company. Confluence Investment Management LLC raised its holdings in shares of NIKE by 873.8% in the 3rd quarter. Confluence Investment Management LLC now owns 2,720,616 shares of the footwear maker's stock valued at $96,310,000 after buying an additional 2,441,233 shares during the period. QRG Capital Management Inc. boosted its holdings in NIKE by 8.5% during the 2nd quarter. QRG Capital Management Inc. now owns 106,883 shares of the footwear maker's stock valued at $4,388,000 after acquiring an additional 8,338 shares during the period. Envestnet Portfolio Solutions Inc. boosted its holdings in NIKE by 214.0% during the 2nd quarter. Envestnet Portfolio Solutions Inc. now owns 32,596 shares of the footwear maker's stock valued at $1,338,000 after acquiring an additional 22,215 shares during the period. Envestnet Asset Management Inc. grew its position in NIKE by 98.4% in the 2nd quarter. Envestnet Asset Management Inc. now owns 2,202,581 shares of the footwear maker's stock valued at $90,416,000 after acquiring an additional 1,092,282 shares in the last quarter. Finally, State Street Corp grew its position in NIKE by 6.8% in the 2nd quarter. State Street Corp now owns 63,598,789 shares of the footwear maker's stock valued at $2,636,104,000 after acquiring an additional 4,052,428 shares in the last quarter. Hedge funds and other institutional investors own 64.25% of the company's stock.

NIKE Price Performance

The company has a debt-to-equity ratio of 0.40, a current ratio of 1.96 and a quick ratio of 1.36. The company has a market capitalization of $49.30 billion, a PE ratio of 15.90, a price-to-earnings-growth ratio of 2.43 and a beta of 1.09. The stock's 50 day simple moving average is $39.04 and its 200-day simple moving average is $42.94.

NIKE (NYSE:NKE - Get Free Report) last posted its quarterly earnings data on Thursday, October 1st. The footwear maker reported $0.48 EPS for the quarter, beating the consensus estimate of $0.43 by $0.05. NIKE had a net margin of 6.70% and a return on equity of 16.54%. The business had revenue of $11.21 billion during the quarter, compared to analyst estimates of $11.32 billion. During the same quarter last year, the firm posted $0.49 earnings per share. The business's revenue for the quarter was down 4.3% compared to the same quarter last year. NIKE has set its FY 2027 guidance at 1.150-1.350 EPS. As a group, equities analysts forecast that NIKE, Inc. will post 1.61 earnings per share for the current fiscal year.

NIKE Announces Dividend

The firm also recently declared a quarterly dividend, which was paid on Thursday, October 1st. Shareholders of record on Tuesday, September 1st were given a $0.41 dividend. This represents a $1.64 annualized dividend and a yield of 4.9%. The ex-dividend date of this dividend was Tuesday, September 1st. NIKE's dividend payout ratio (DPR) is currently 78.47%.

NIKE Company Profile

NIKE, Inc is a global sportswear company that designs, develops, markets and sells athletic footwear, apparel, equipment, accessories and related services. Its products are marketed under the NIKE, Jordan and Converse brands and are used across a broad range of sports and lifestyle activities, including running, basketball, football, training and outdoor pursuits.

The company distributes its products through a combination of wholesale partners, NIKE-owned retail stores and digital platforms.

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